BankruptcyMisconduct.com has been directing the public's attention to peculiar circumstances in a number of bankruptcy cases. These cases are exemplary in their demonstration of the need for a closer scrutiny by the media, the business community, and of course the Justice Department. These cases include:
SEC ignoring Madoff warnings in re: Aureal, Inc.; USBC Northern District of California, No. 00-42104 T11. Finally Public! This document was kept secret in deference to the SEC. Well, time's up. Bernie Madoff was not the only hedge fund crook filling false documents with the SEC. There were other scams employed by hedge funds right under the noses of the SEC besides a Ponzi Scheme like Bernie's.
How about when a hedge fund does a hostile takeover of a public company and takes all of the money for themselves while their conflicted lawyers oversee multiple fraudulent filings to the SEC?
Harry Markopoulos
was not the only independent business person who took the risk of
putting his own name on a letter to the SEC warning of crime by a hedge fund. This document is the follow-up, with color charts detailing obvious SEC violations, sent initially via eMail and later copied via certified letter to Linda Chatman Thomsen and her boss Christopher Cox, to the
original letter requested by Marc J. Fagel regarding
SEC filings by the client of PriceWaterhouseCoopers and HBD.
Surely it is a sad notion, but please realize that spouses, nieces, and nephews of SEC lawyers count on corruption in order to land multi-million dollar roles as partners at BigLaw law firms, broker dealers, and hedge funds. These corrupt government lawyers view their job responsibilities and authority as a bargaining chip to riches:
"You want me to look the other way?"
"Send more $$$ business to my husband's law firm!" or "My niece needs to make partner!" or "If my cousin's wife is hired by your hedge fund I'll see that your fine will be a minor slap on the wrist". Yes, justice in America has been traded for favors by SEC and DOJ lawyers, and the of the spiral of unopposed fraud is what has caused our current financial crisis.
James F. Walker USBC Southern District of Florida, No. 03-32158-PGH. An honest lawyer, Mary Alice Gwynn discovers fraud on the court by Gary J. Rotella, Esq. as he acted as debtor's counsel to the convicted felon James F. Walker before the Honorable Paul G. Hyman, Jr. Mr. Rotella defrauded the court when he lied about having received a blatantly conflicting 50% ownership interest in the debtors sole disclosed asset: a Cat Cay Caribbean mansion in the Bahamas. But that's not all! A Court appointed "professional" for the creditors also lied: Keeping secret that he was the President of the very same exclusive Cat Cay millionaires' getaway - and was either working as a mole for the felon from the start or sabotagued the case in order to hide his own disclosure fraud as convict Walker's lawyer clearly obtained proof of the undisclosed conflict during specially crafted discovery which served no other purpose. The conduct of Judge Paul Hyman is dishonorable as he blatantly protects all of his brethren criminals:
Judicial Complaint against Judge Hyman with exhibits list, Exhibits 1-9 thereto, and
Exhibits 13-17 thereto - Lucky exhibit 13! is the complaint showing crime by Gary Rotella, Esq.
eToys Inc. et al. USBC Delaware, Nos. 01-706 etc.
Baron's Stores, Inc. USBC Southern District of Florida No. 97-25645 BKC-PGH. A forensic document specialist finds that the official plan filed by the Debtor's counsel was a fabrication. Read about it here in our documents section. Meryl Lanson is the Terminator against bankruptcy crime by sleezy lawyers, and she will never give up.
The Leslie Fay Companies, et al. USBC Southern District of New York No. 93-B-41724(TLB). The Leslie Fay crimes involve the former Bear Stearns and the most powerful bankruptcy enterprise in the nation. High profile lawyers paid a million dollar slap on the wrist, a tiny fraction of their fully forfeitable fees, instead of being incarcerated for perjury like Little Kim from Dancing With The Stars. There is no question that the unlawful Court protection of dirty corporate executives and their lawyers in the Leslie Fay case set in motion the spiral of increasing corporate fraud which brought us Enron, WorldCom, Fannie Mae, and our current financial crisis.
Petters Company, Inc., et al. USBC Minnesota, No. BK 08-45257
Ford Motor Company et al. not filed yet, but we think it's coming...
General Motors et al. not filed yet, but we see dirty vultures circling...
AmmoCore Technology Inc. et al. USBC Delaware, No. 06-10318
Worldcom, Inc., et al. (included MCI) USBC Southern District of New York No. 02-13533 (AJG)
- The " Asbestos Ring " involves a number of U.S. federal bankruptcy court reorganization cases. These cases have in common: the State of Delaware, the use of asbestos litigation by injury lawfirms against large companies, astounding mega fees paid by the debtors to bankruptcy professionals, a locus of several bankruptcy industry firms, and most significantly the emerging evidence of a pattern of fraud by one or more bankruptcy professionals.
CH II American Inn Inc. USBC (Oklahoma?) Bk-85-2221-A. Numerous possible conflict of interest, ACPOC Syndrome. Will a nation, whose freedom and prosperity would surely end but for the dedication and sacrifice of its armed forces, survive if the honor of its warriors and the Constitution for which they risked their lives to defend, are defamed and disrespected in its Courts by profiteering brethren of the bar?
Advocacy & Resources Corporation USBC, Middle District of Tennessee, Cookeville Division, Debtor Case N0. 206-03067 Chapter 11, Judge Lundin Presiding.
"Rick" USBC, Northern District of Illinois, Western Division, Case Number 99-50046, Judge Manuel Barbosa presiding. Issues related to the conduct of the private Trustee: Thomas Lester and his law firm Hinshaw & Culbertson, include a closed bankruptcy case reopened under peculiar justification, the forced sale of a house occupied by a single parent with two children for $138,389.59 in gross proceeds, less $112,557.87 for the cost of sale. Allegations include that a prior valid court order of payment to the divorced spouse was ignored, as well as the homestead exemption. Upon information and belief, a bankruptcy trustee or other professional is not entitled to having fees paid that did not or could have benefited the estate.
John Deep USBC Northern Distric of New York, Nos. 02-11552, 02-11745, and 02-11755.
Mr. Deep is well known for his creation of Aimster, and was apparrantly represented by the renowned attorney
David Boies, who in turn is reported to have earned fees representing clients including Microsoft, the presidential election dispute on behalf of Al Gore, and entities associated with the RIAA.
WebSci Technologies, Inc. & Ramkrishna S. Tare USBC District of New Jersey Nos. 02-38258 (RG) & 02-38316 (RG)
Incredible allegations of undisclosed conflict of interest, false affadavits, conspiracy, and more. Bogus order overturned on appeal. Watch this case, we will and we won't let its ultimate resolution be a quiet whisper.
Baron's Stores, Inc. USBC Southern District of Florida No. 97-25645 BKC-PGH
The Leslie Fay Companies, et al. USBC Southern District of New York No. 93-B-41724(TLB)
Stone & Webster, et al. USBC District of Delaware No. 00-2142 (PJW)
Aureal, Inc., USBC Northern District of California No. 00-42104 (T)
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The Voices Grow In Number And Strength
"No country -- certainly not the United States -- is free of corruption. In the real world of limited
resources, we know that we can only detect, investigate and prosecute a
small percentage of those officials who are corrupt." -- U.S. Attorney General John D. Ashcroft
"
I remain convinced that there is no more important area in the fight against corruption than the challenge for us within the law enforcement and justice sectors to keep our own houses clean." -- U.S. Attorney General John D. Ashcroft
"It appears that the
watchdog needs watchdogging". - Exact words of a Federal Judge describing the U.S. Trustees at the DOJ, whose role is to act as the watchdog against crime and corruption.
"A Pack Of Dogs"- Another Federal Judge describing the U.S. Trustees.
"Competition for Big Cases Is Corrupting the Bankruptcy Courts" UCLA Professor and renowned expert on bankruptcy in the U.S.A.
Bankruptcy Misconduct.Com was created out of concern about the current state of federal bankruptcy practice. This website is part of an ongoing effort to illuminate in a clear and direct way:
operations and activities of various governmental agencies as they act, or fail to act, to police, enforce, and fulfill important Congressional mandates related to the integrity of the bankruptcy process as well as applicable rules of professional and judicial conduct.
inherent and systemic problems with the current practices of professionals involved in the bankruptcy process due to the self regulation and self policing mechanisms which purport to regulate, albiet in secret, the actions of lawyers.
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Bankruptcy is Big Business
The Bankruptcy Investment specialty has become “big business” and has attracted a wide variety of players including many hedge funds. For example, in the largest U.S. bankruptcy case of MCI / Worlcom there have been at least 50 entities involved in claims transfers encompassing hundreds of millions of dollars. As the scope of the claims trading activity has increased, so too has the potential for corrupt practices and actions involving the professionals retained in those related proceedings. Despite the rampant claims trading involved in large bankruptcy cases, there are essentially no precautions in place to avoid corrupt practices and actions involving bankruptcy professionals, other than the faith by the Department Of Justice and the Judiciary in the honesty of the attorneys employed in these million and billion dollar Mega Bankruptcy cases, that these lawyers' actions and sworn declarations indcluding mandatory disclosure of conflicts of interest will reflect their supreme loyalty to the bankruptcy estate, and not to conflicted clients.
We
hope that the information released by this website will significantly
contribute to public understanding. Perhaps non lawyer oversight of these various
governmental and quasi-governmental agencies and professionals is due. Particularly troubling is these agency’s and professionals activities, policies, and regulations
relating to corruption in bankruptcy practice and attorney conduct in general.
Bankruptcy Misconduct.Com was originally created by Next Factors, Inc. (abbreviated "Next") because of concern about the current state of federal bankruptcy practice. Next was a small, private firm engaged in the business of purchasing and accepting assignments of claims against debtors in large bankruptcy proceedings, a practice commonly referred to as claims trading, distressed investing, or vulture investing.
In stark contrast with certain of its competitors, Next was not affiliated with current or formerly practicing bankruptcy lawyers or professionals, hedge funds, brokerage firms, corporate finance professionals, or relatives of any of the above. Furthermore, Next did not give money to any bankruptcy professional, either directly or through any affiliate, at the same time when such professional had a duty to be adverse to Next in the context of any bankruptcy proceedings. We can not understate how significant, if not unique, is this absence of a conflict of interest by a vulture investor.
Bankruptcy Misconduct intends to participate in the sponsorship of one or more scholarship awards where students can submit written material regarding proposed topics. We contemplate that winning students entries will receive award certificates may also receive a cash awards which can be used in furtherance of their the study of law, economics, or government.
An
additional purpose of this site is to enable all parties to assemble
and converse about bankruptcy misconduct in general as well as on a
number of specific issues. Remember to view our Bankruptcy Misconduct Forum where you can participate in ongoing discussions and suggest your own new topic for discussion and analysis.
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Marcia's Petard
Paul Traub & Mark Dreier Named
